A study
(in PDF)
conducted for the Mayor's Food Policy Task Force by
the New York City Departments of Health and City Planning
and the New York City Economic Development Corporation
shows that many neighborhoods across the city are underserved
by grocery stores. The resulting lack of nutritious,
affordable fresh food in these neighborhoods has been
linked to higher rates of diet-related diseases, including
heart disease, diabetes and obesity.

In response, the City has established the Food Retail
Expansion to Support Health (FRESH) program. FRESH provides
zoning and financial incentives to promote the establishment
and retention of neighborhood grocery stores in underserved
communities throughout the five boroughs.

FRESH PROGRAM ELIGIBILITY

The FRESH program is open to grocery store operators
renovating existing retail space or developers seeking
to construct or renovate retail space that will be leased
by a full-line grocery store operator. FRESH benefits are available to stores within the designated FRESH-eligible areas, shown below. Tax incentives are discretionary and will be assessed on a per-case basis for eligibility.

Stores that benefit from the FRESH program
must also meet the following criteria:

Provide a minimum of 6,000 square feet of
retail space for a general line of food and
nonfood grocery products intended for home preparation,
consumption and utilization;

Provide at least 50 percent of a general line
of food products intended for home preparation,
consumption and utilization;

The following financial incentives are available to
eligible grocery store operators and developers through
the New York City Industrial Development Agency (NYCIDA)*:

Real Estate Tax Reductions

A 25-year land tax abatement may be offered, equal
to $500 multiplied by each full-time equivalent employee
at time of application (or the full value of the land
tax for project sites located within Empire and Empowerment
Zones).

A 25-year stabilization of building taxes may be
offered, based on the pre-improvement assessed value.

A phase-out of the real estate tax benefits begins
in year 22 and continues through year 25 at 20 percent
each year. In year 26, real estate taxes increase
to full amount.

Sales Tax Exemption

An exemption from the 8.875 percent sales tax may
be offered on materials to construct, renovate or
equip facilities.

Mortgage Recording Tax Deferral

A deferral of mortgage recording tax relating to
the project's financing may be offered, equal to 2.05
percent of the mortgage amount for mortgages of $500,000
or less, and 2.80 percent for mortgages greater than
$500,000.

*All NYCIDA benefits are discretionary. Companies requesting
assistance from the NYCIDA will be evaluated by NYCIDA
staff individually to determine specific eligibility.
All benefits are, by statute, subject to the approval
of the NYCIDA’s Board of Directors. Companies
must request NYCIDA assistance prior to entering into
any property lease, acquisition or renovation contracts,
unless such contracts are contingent upon NYCIDA assistance.

New York Healthy Food & Healthy Communities
Fund
Grocery store operators and developers in underserved
communities may be eligible to apply for pre-development
grants and loans, acquisition loans, equipment financing,
and construction and permanent loans through the New
York Healthy Food & Healthy Communities Fund. For
more information, please visit the Low Income Investment
Fund’s website.

NYSERDA Energy Efficiency Benefits
Grocery store operators and developers can independently
access energy efficiency benefits through the New York
State Energy Research and Development Authority’s
(NYSERDA’s) Existing Facilities, New Construction,
Energy Audit, and FlexTech programs. For
more information, please visit NYSERDA’s website.